Sources: China said to study CNY devaluation as a tool in trade spat – Bloomberg

Bloomberg quoted people familiar with the matter, as saying that China is said to study the impact of gradual Yuan devaluation to counter the US-China trade spat.

Key Headlines:

China is evaluating the potential impact of a gradual CNY depreciation.

Senior Chinese officials are studying a two-pronged analysis of the Yuan.

The first part looks at the effect of using the currency as a negotiation tool with the US.

The second part looks at what would happen if China depreciates the Yuan to offset any trade impact.

The AUD/USD pair dropped back towards the 0.7670 region on the above headlines.